News

Forage rainfall plan improved for 2014

Page Content

​​​Following a review of forage insurance in Ontario, Agricorp has made several improvements to the Production Insurance forage rainfall plan for 2014. Industry representatives, Agricorp and the Ontario Ministry of Agriculture and Food collaborated to provide better protection for forage producers.

There are five improvements to the plan for 2014:

Producers can choose more coverage. Producers now have the option to insure their forage up to a greater maximum value. They can insure up to the harvested value of their forage, not just the standing value.

Claim calculations better reflect market conditions. Claims calculations now include a price index to reflect higher forage replacement costs in periods of significant rainfall shortage. The price index is higher when rainfall shortage is more severe. A higher price index results in a larger payment.

Less rainfall means larger payments. The connection between rainfall and yield has changed in the calculation of a claim. Smaller yields are now assumed in connection to rainfa​ll shortages. This will lead to larger payments for larger rainfall deficits.

Claims are triggered at a smaller rainfall deficit. Producers will trigger a claim when their average rainfall is less than 85% of the historical average, instead of the previous threshold of 80%.

A daily rainfall minimum is added. Any day with rain less than 1mm is counted as zero. This minimum recognizes that small amounts of rain do not help growth.

A hot and dry 2012 crop season resulted in forage issues throughout Ontario. Rainfall was extremely variable and most forage customers experienced long periods of hot dry weather and lower-than-average rainfall. As a result, producers faced forage shortages and high replacement costs. These challenges, along with the historical challenges of insuring forage, led to an intensive review of the forage rainfall plan.

The in-depth review of the plan included comprehensive discussions as well as survey feedback from over 300 growers , analysis of plan designs in other jurisdictions, recommendations from a national forage review, and information from academic experts and weather service providers.